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Govt warns of increased pressure on revenue, expenditure

The government on Tuesday warned of pressures on both revenue and expenditure during the remaining part of the current fiscal despite close to 16 per cent increase in the revenue receipts during the first six months of 2002-03.

"While the revenue and expenditure trends in the first half of the current year have been more or less satisfactory, the deficient monsoon raises concern about the outturn for the current year unless corrective actions are initiated," the mid-year review presented by Finance Minister Jaswant Singh to Parliament said.

The review said expenditure on food and fertiliser subsidies which had increased rapidly in the first half of the current year could increase further during the remaining part of the year on account of "increase in minimum support price, additional drought relief and increases in the retention prices of fertilisers."

Enhancement of revenue will require restructuring of the tax system by moving towards an efficient tax administration, a system with minimum of exemption and a move to VAT (Value Added Tax), it said adding there was a clear need for better cost recovery through appropriate user charges to enhance non tax revenue.

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